On March 14, 2002, the Kentucky Public Service Commission (PSC) issued an order allowing Louisville Gas and Electric (LG&E) and Kentucky Utilities (KU) to offer net metering to qualified customers as part of a pilot program. Residents and businesses in KU or LG&E territory that install solar, wind or small hydro systems are eligible. Residential systems are limited to a maximum capacity of 10 kW, while systems for non-residential customers are limited to 25 kW. This is a pilot project effective for three years and is currently limited to 25 customers for each utility. Because this program requires a minimum one-year participation period, new customers are no longer being accepted.

Customers will not be paid for excess generation. If eligible customers generate more electricity during a billing period than is consumed, the excess generation will be carried forward to the next billing period.

Kentucky utilities are currently allowing public comment on developing their individual tariffs, which will be announced this winter. The pilot programs will last until their expirations, at which point the new tariffs will be effective.